The proposed research explores gene regulation at the level of chromatin structure in Drosophila by focusing on transvection, an unusual form of gene modulation that reflects the proximity of a gene to its homologue. It addresses transvection at the yellow gene. Here, transvection is the basis for intragenic complementation. In particular, studies indicate that when certain alleles are paired, the enhancers of one can act in trans on the promoter of the other. The data also suggest that a prerequisite for the release of an enhancer to act in trans may be the disabling of its own promoter. The preliminary studies have expanded considerably upon this model. In addition, they suggest a second mode of transvection in which the pairing of dissimilar alleles leads to gene topologies that allow an enhancer to bypass a chromatin insulator. The proposed research tests and extends these surprising and new interpretations of transvection at yellow. Specific Aim 1 tests the model in which enhancer action in trans is controlled by the transcriptional competence of the promoter. Specific Aim 2 tests the proposal that pairing can dictate gene topologies to allow an enhancer to bypass an insulator. In Specific Aim 3, the studies extend beyond yellow and ask whether genes and the genome are generally permissiveness for transvection. Finally, Specific Aim 4 searches for the trans- acting factors that mediate and control transvection. Our studies use two technologies to meet the requirement of transvection for homologue pairing. These are targeted gene conversion (Specific Aims 1, 2, and 3) and a technique that allows the placement of genes into allelic positions on different chromosomes (Specific Aim 3). Specific Aim 4 uses standard genetic and molecular biological approaches. There is strong evidence that homologue pairing is a potent force that can cause severe consequences in many organisms. It may underlie some medical diseases and limit certain agricultural technologies. Therefore, the studies here are likely to benefit human welfare through contributions to both medicine and agriculture.